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Vietnam's payment landscape is witnessing a heated battle between e-wallets, VietQR, and bank apps

Amid increasingly fierce competition in the digital payments sector, e-wallets are facing significant challenges to maintain their long-term viability.

After seeing explosive growth from 2018 to 2023, thanks to the Government's policy of promoting non-cash payments, e-wallets, especially those only focused on payment and money transfer services, are facing fierce competition against the QR code-using payment methods and banking applications.

According to fintech, banking, and payment consulting firm Kapronasia, amid increasingly fierce competition in the digital payments sector, e-wallets are facing significant challenges to maintain their long-term viability. Only a few e-wallets are expected to succeed.

Moca Technology and Services Joint Stock Company (Moca)’s decision to stop opening new accounts and cease providing its e-wallet service from July 1 this year is an indication of the competitive pressure in the market.

Founded by former senior employees of Microsoft, and Google, and leading finance and banking experts, Moca developed a mobile application enabling users to make online or direct payments using ATM, Visa/Mastercard, and JCB cards. Moca gained prominence through its partnership with Grab, deploying the GrabPay by Moca payment method in 2018. However, as Grab expanded its partnerships, collaborating with Zalo Pay and MoMo in 2023, Moca’s exclusivity as a cashless payment method on the Grab app diminished.

E-wallets, which are affiliated with major e-commerce ecosystems such as ShopeePay with Shopee, can continue to grow strongly due to their market dominance.

However, Trần Thị Kiều Oanh, director of Fiin Group’s market research and consulting division, said even ShopeePay is currently facing competitive pressure with Apple Pay and Samsung Pay.

The development of VietQR has prompted a reassessment of the role of e-wallets in the payment sector in Vietnam. In 2021, Vietnam launched VietQR, an online money transfer service with the participation of 14 banks.

E-wallets have no clear long-term advantage compared with traditional banks, as many services such as instant money transfers and bill payments are also available on mobile banking apps, Oanh said, adding that VietQR facilitates cashless payments more effectively than other payment methods.

According to Kapronasia, more than 62 percent of Vietnamese consumers are currently using QR code payments and they scan the code about 16 times per month on average.

The widespread adoption of QR codes has reduced the need to use cash. The shift to QR code payments has encouraged more consumers to adopt digital payment methods over traditional cash transactions.

According to Oanh, the launch of VietQR has sparked a new payment trend, which has forced e-wallets to innovate and enhance services to take a better position in the market.

However, Oanh believes e-wallets with a strong customer database and successful ecosystem integration can still serve specific purposes without being left behind.

Around 45 licensed e-wallets operate in Vietnam, with 36.23 million active users by the end of 2023, representing 63.23 percent of the nearly 57.31 million activated e-wallets. Despite double-digit growth in transactions and transaction values from 2018 to 2023, the market share is predominantly controlled by giants like MoMo, Zalo Pay, ViettelPay, ShopeePay, and VNPay.



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